There is one charitable activity that has proved a hit in Japan through recent years, it’s the “furusato nozei” or hometown tax. Hometown tax was originally suggested year 2007 by Japan Prime Minister Shinzo Abe but officially acknowledge by year 2008 in which Japanese citizens living anywhere can donate money to local governments that they want to support. Some people choose a hometown not on the basis of any family ties, but simply because they like the area as well and help it. Needy regions are especially delighted to this program and most of them have been suffering financially as a result of ageing and shrinking populations. Other Japanese have set up websites offering charitable gifts, exotic foods and other goodies in return for a share of urbanites taxes. But as the program was in the main stream, donations got bigger, various issues occurred and three samples are given below:

  • Reward gifts are becoming expensive, since premium gifts are used to attract more donors so people contribute or donate money with an eye to the rewards rather than supporting the local areas.
  • Some of the local governments are reporting losses to the program while the other are enjoying the surplus or excess calculated from the difference of total revenue collected from donations and the total tax deductions acquire
  • A higher limit was set to the tax deductible donation as stated to income, family composition and other deductions. The higher the income, the higher the tax-deductible amount

However, Hometown tax is still developing and progressing. It is said that the government monitors the program whether or not it leads to regional recovery in Japan while continuing its principle of supporting rural areas and hometowns.